Recession: Group Kicks Against Sale Of NLNG, Other FG Assets

[caption id="attachment_11968" align="alignnone" width="699"]Aliko Dangote[/caption]

The Revenue Mobilisation Allocation and Fiscal Commission, RMAFC has said that Nigerian Liquefied Natural Gas, NLNG, and other federation assets should not be sold to meet the country’s financial obligations.

This is contained in a statement signed by the commission’s Acting Chairman, Alhaji Shettima Abba-Gana, on Tuesday in Abuja.

Abba-Gana was reacting to Alhaji Aliko Dangote’s suggestion that the country`s assets be sold off to augment the current revenue shortfall being experienced by the nation following the economic recession.

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Dangote, during an interview with CNBC, had advised President Muhammadu Buhari to embark on a wave of asset selling to boost the recession-hit economy.

“I think the real challenge for us is now for us to have the political will in terms of selling some assets such as the NLNG(Nigerian Liquefied and Natural Gas) among others” Dangote said.

“I think it’s an easier route than the IMF (International Monetary Fund) or the World Bank to borrow money, because what you need to do is actually to beef up the reserves.” Aliko Dangote made the statement before Nigeria’s credit rating was downgraded to B from B+ by S&P Global Ratings on Friday.

But Abba-Gana said it would be unwise for the Federal Government to dispose of its crown jewels which were generating revenues and keeping the Federation Account healthy over a long term.

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He cited the NEITI 2013 Audit and Financial Report of Nigeria’s oil and gas industry, adding that 12.9 billion dollars was received by the NNPC from NLNG over an eight-year period.

He added that the NNPC, however, did not remit the amount to the Federation Account, saying that the audit showed that NLNG paid 1.2 billion dollars as dividends for 2013.

“It is the considered view of the commission that Nigeria’s assets like NLNG and other strategic national resources should not be sold to meet short-term financial obligation.”

He said that the amount needed from the sale of the assets could be borrowed from the International Monetary Fund, IMF.

He added that revenue from the assets could be used to hamortise the loans over an agreed period.

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He further said that after the hamortisation of the loans, the assets would still be owned by the federation in addition to their regular dividends and revenue.

Abba-Gana, therefore, advised that instead of selling off such vital assets, wealthy Nigerians should be encouraged to set up their own LNG projects.

Nigeria is ranked seventh in the world and first in Africa with natural gas reserves base totaling 188 trillion cubic feet, Tcf, as at May 1, 2015.

Nigeria’s natural gas is regarded as one of the best in the world with low hydrogen sulphide, H2S, or carbon dioxide, CO2, impurity levels.

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